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Lonmin receives bank support for Pandora JV acquisition

JOHANNESBURG (miningweekly.com) – Platinum producer Lonmin has received consent from its lending banks to acquire the interests in the Pandora joint venture held by partners Anglo American Platinum (Amplats) and Northam Platinum.

In November 2016, Lonmin entered into an agreement with Amplats to buy its 42.5% interest in Pandora.

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In May, it agreed to buy the remaining 7.5% interest in Pandora from Northam, which will give it full ownership of the operation.

Lonmin expects the acquisition of these interests to be finalised before it announces its full-year results in November.

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“Completion should unlock significant synergies, allowing us to extend mining at the Saffy shaft without having to spend R2.6-billion in capital expenditure, R1.6-billion of which would have been required over the next four years,” Lonmin said in a statement on Friday.

The company has also received a pre-emptive waiver of its consolidation tangible net worth covenant for the six months from September 30 to March 30.

Its loan facility agreements require it to test two covenants related to the tangible net worth every six months. Lonmin said its tangible net worth is affected by macroeconomic events out of its control, such as the rand/dollar exchange rate.

Meanwhile, the company said it expects its full-year sales to be slightly above previous full-year guidance.